Blue Cross Blue Shield Association
Encyclopedia
The Blue Cross Blue Shield Association (BCBSA) is a federation of 39 separate health insurance organizations and companies in the United States. Combined, they directly or indirectly provide health insurance to over 100 million Americans. The history of Blue Cross dates back to 1929, while the history of Blue Shield dates to 1939. The Blue Cross Association dates back to 1960, while its Blue Shield counterpart was actually created in 1948. The two organizations merged in 1982, forming the current association. The company has its headquarters in the Michigan Plaza
complex in the Chicago Loop
area of Chicago, Illinois.
Blue Cross is a name used by an association of health insurance
plans throughout the United States
. Its predecessor was developed by Justin Ford Kimball
in 1929, while he was vice-president of Baylor University
's health care facilities in Dallas, Texas
. The first plan guaranteed teachers 21 days of hospital care for $6 a year, and was later extended to other employee groups in Dallas, and then nationally. The American Hospital Association
(AHA) adopted the Blue Cross symbol in 1939 as the emblem for plans meeting certain standards. In 1960 the AHA commission was superseded by the Blue Cross Association. Affiliation with the AHA was severed in 1972.
The Blue Shield concept was developed at the beginning of the 20th century by employers in lumber and mining camps of the Pacific Northwest to provide medical care by paying monthly fees to medical service bureaus composed of groups of physicians. The first official Blue Shield Plan was founded in California in 1939. In 1948 the symbol was informally adopted by nine plans called the Associated Medical Care Plan, and was later renamed the National Association of Blue Shield Plans.
In 1982 Blue Shield merged with The Blue Cross Association to form the Blue Cross and Blue Shield Association.
Prior to the Tax Reform Act of 1986
, organizations administering Blue Cross Blue Shield were tax exempt under 501(c)(4) as social welfare plans. However, the Tax Reform Act of 1986 revoked that exemption because the plans sold commercial-type insurance. They became 501(m) organizations, subject to federal taxation but entitled to "special tax benefits" under IRC 833. In 1994, the Blue Cross Blue Shield Association changed to allow its licensees to be for-profit corporations. Some plans are still considered not-for-profit at the state level.
. They also act as administrators of Medicare
in many states or regions of the US, and provide coverage to state government employees as well as to the federal government employees under a nationwide option of the Federal Employees Health Benefit Plan
.
The 14-state WellPoint
is the largest Blue Cross Blue Shield member, and is a publicly traded
company. Other multi-state organizations include CareFirst in the Mid-Atlantic
and The Regence Group
in the Pacific Northwest. The largest non-investor owned member is Health Care Service Corporation
, which operates four Blue Cross and Blue Shield Plans in the Midwest and Southwest (Illinois, Oklahoma, Texas, and New Mexico).
In May 2009, BCBS licensee, Blue Cross and Blue Shield of North Carolina, readied an ad campaign against the introduction of government-run health care
, legislation to be introduced to Congress by President Barack Obama
, although the BCBSNC CEO said that the company was in favor of reforming the current system.
Michigan Plaza
Michigan Plaza is an office complex in Chicago Loop area of Chicago, Illinois, United States. The complex is managed by MB Real Estate.The complex consists of the 44 story 205 North Michigan Avenue and the 25 story 225 North Michigan Avenue...
complex in the Chicago Loop
Chicago Loop
The Loop or Chicago Loop is one of 77 officially designated Chicago community areas located in the City of Chicago, Illinois. It is the historic commercial center of downtown Chicago...
area of Chicago, Illinois.
History
Blue Cross and Blue Shield developed separately, with Blue Cross plans providing coverage for hospital services, while Blue Shield covered physicians' services.Blue Cross is a name used by an association of health insurance
Health insurance
Health insurance is insurance against the risk of incurring medical expenses among individuals. By estimating the overall risk of health care expenses among a targeted group, an insurer can develop a routine finance structure, such as a monthly premium or payroll tax, to ensure that money is...
plans throughout the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
. Its predecessor was developed by Justin Ford Kimball
Justin Ford Kimball
Justin Ford Kimball was an American businessman, educator, and inventor of the Blue Cross Group Hospital Insurance -Early life:...
in 1929, while he was vice-president of Baylor University
Baylor University
Baylor University is a private, Christian university located in Waco, Texas. Founded in 1845, Baylor is accredited by the Southern Association of Colleges and Schools.-History:...
's health care facilities in Dallas, Texas
Dallas, Texas
Dallas is the third-largest city in Texas and the ninth-largest in the United States. The Dallas-Fort Worth Metroplex is the largest metropolitan area in the South and fourth-largest metropolitan area in the United States...
. The first plan guaranteed teachers 21 days of hospital care for $6 a year, and was later extended to other employee groups in Dallas, and then nationally. The American Hospital Association
American Hospital Association
The American Hospital Association is an organization that promotes the quality provision of health care by hospitals and health care networks through such efforts as promoting effective public policy and providing information related to health care and health administration to health care...
(AHA) adopted the Blue Cross symbol in 1939 as the emblem for plans meeting certain standards. In 1960 the AHA commission was superseded by the Blue Cross Association. Affiliation with the AHA was severed in 1972.
The Blue Shield concept was developed at the beginning of the 20th century by employers in lumber and mining camps of the Pacific Northwest to provide medical care by paying monthly fees to medical service bureaus composed of groups of physicians. The first official Blue Shield Plan was founded in California in 1939. In 1948 the symbol was informally adopted by nine plans called the Associated Medical Care Plan, and was later renamed the National Association of Blue Shield Plans.
In 1982 Blue Shield merged with The Blue Cross Association to form the Blue Cross and Blue Shield Association.
Prior to the Tax Reform Act of 1986
Tax Reform Act of 1986
The U.S. Congress passed the Tax Reform Act of 1986 to simplify the income tax code, broaden the tax base and eliminate many tax shelters and other preferences...
, organizations administering Blue Cross Blue Shield were tax exempt under 501(c)(4) as social welfare plans. However, the Tax Reform Act of 1986 revoked that exemption because the plans sold commercial-type insurance. They became 501(m) organizations, subject to federal taxation but entitled to "special tax benefits" under IRC 833. In 1994, the Blue Cross Blue Shield Association changed to allow its licensees to be for-profit corporations. Some plans are still considered not-for-profit at the state level.
Current organization
Blue Cross and/or Blue Shield insurance companies are licensees, independent of the association (and traditionally each other), offering insurance plans within defined regions under one or both of the association's brands. Blue Cross Blue Shield insurers offer some form of health insurance coverage in every U.S. stateU.S. state
A U.S. state is any one of the 50 federated states of the United States of America that share sovereignty with the federal government. Because of this shared sovereignty, an American is a citizen both of the federal entity and of his or her state of domicile. Four states use the official title of...
. They also act as administrators of Medicare
Medicare (United States)
Medicare is a social insurance program administered by the United States government, providing health insurance coverage to people who are aged 65 and over; to those who are under 65 and are permanently physically disabled or who have a congenital physical disability; or to those who meet other...
in many states or regions of the US, and provide coverage to state government employees as well as to the federal government employees under a nationwide option of the Federal Employees Health Benefit Plan
Federal Employees Health Benefit Plan
The Federal Employees Health Benefits Program is a system of "managed competition" through which employee health benefits are provided to civilian government employees and annuitants of the United States government...
.
The 14-state WellPoint
WellPoint
WellPoint, Inc. is the largest health plan company in the Blue Cross and Blue Shield Association. It was formed when WellPoint Health Networks, Inc. merged into Anthem, Inc., with the surviving Anthem adopting the name, WellPoint, Inc...
is the largest Blue Cross Blue Shield member, and is a publicly traded
Stock exchange
A stock exchange is an entity that provides services for stock brokers and traders to trade stocks, bonds, and other securities. Stock exchanges also provide facilities for issue and redemption of securities and other financial instruments, and capital events including the payment of income and...
company. Other multi-state organizations include CareFirst in the Mid-Atlantic
Mid-Atlantic States
The Mid-Atlantic states, also called middle Atlantic states or simply the mid Atlantic, form a region of the United States generally located between New England and the South...
and The Regence Group
The Regence Group
The Regence Group is a nonprofit Blue Cross Blue Shield licensed health insurance company headquartered in Portland, Oregon. It is licensed to sell health insurance plans under the Blue Cross Blue Shield name in Utah, and Oregon. It is licensed under the Blue Shield name in Idaho and western...
in the Pacific Northwest. The largest non-investor owned member is Health Care Service Corporation
Health Care Service Corporation
Health Care Service Corporation , with 13 million members in its Blue Cross and Blue Shield Plans in Illinois, New Mexico, Oklahoma and Texas, is the nation’s largest non-investor-owned health insurer and fourth largest overall....
, which operates four Blue Cross and Blue Shield Plans in the Midwest and Southwest (Illinois, Oklahoma, Texas, and New Mexico).
Publicly traded companies
- AnthemAnthem (insurance)Anthem was an insurance company which began in the 1980s as a spin-off of the group insurance operations of American General Insurance. From its move to a publicly-traded company in 2001 until its final merger in 2004, it merged the Blue Cross Blue Shield organizations of several states to achieve...
for-profit (WellPointWellPointWellPoint, Inc. is the largest health plan company in the Blue Cross and Blue Shield Association. It was formed when WellPoint Health Networks, Inc. merged into Anthem, Inc., with the surviving Anthem adopting the name, WellPoint, Inc...
)- Anthem Blue Cross Blue Shield
- Colorado
- Connecticut
- Indiana
- Kentucky
- Maine
- Missouri
- Nevada
- New Hampshire
- Ohio
- Parts of Virginia
- Wisconsin
- Anthem Blue CrossAnthem Blue CrossAnthem Blue Cross is a major US health insurance provider which is a subsidiary of insurance giant Wellpoint. Anthem has about 800,000 customers, and has more individual policyholders in California than any other insurer. It is an independent licensee of the Blue Cross Blue Shield Association...
- California
- Blue Cross Blue Shield of Georgia
- Empire Blue Cross and Blue Shield (New York)
- Anthem Blue Cross Blue Shield
Multi-state private companies
- CareFirst
- District of Columbia
- Maryland
- Parts of Virginia
- Health Care Service CorporationHealth Care Service CorporationHealth Care Service Corporation , with 13 million members in its Blue Cross and Blue Shield Plans in Illinois, New Mexico, Oklahoma and Texas, is the nation’s largest non-investor-owned health insurer and fourth largest overall....
- Blue Cross Blue Shield of Illinois
- Blue Cross Blue Shield of New Mexico
- Blue Cross Blue Shield of Oklahoma
- Blue Cross Blue Shield of Texas
- HighmarkHighmarkHighmark is a not-for-profit health insurance company based in Pittsburgh, Pennsylvania, United States. It is the largest health insurer in Pennsylvania, and through a purchase in 1996, the largest health insurer in West Virginia. As Highmark Blue Cross Blue Shield, it primarily serves the 29...
- Highmark Blue Cross Blue Shield (Western Pennsylvania)
- Highmark Blue Shield (Eastern & Central Pennsylvania)
- Mountain State Blue Cross and Blue Shield (West Virginia)
- Premera
- Premera Blue Cross Blue Shield of Alaska
- Premera Blue Cross (Washington)
- The Regence GroupThe Regence GroupThe Regence Group is a nonprofit Blue Cross Blue Shield licensed health insurance company headquartered in Portland, Oregon. It is licensed to sell health insurance plans under the Blue Cross Blue Shield name in Utah, and Oregon. It is licensed under the Blue Shield name in Idaho and western...
- Regence Blue Shield of Idaho
- Regence Blue Cross Blue Shield of Oregon
- Regence Blue Cross Blue Shield of Utah
- Regence Blue Shield (Washington)
- Wellmark Blue Cross Blue Shield
- Iowa
- South Dakota
Single-state or regional companies
- Blue Cross and Blue Shield of AlabamaBlue Cross and Blue Shield of AlabamaBlue Cross and Blue Shield of Alabama is a health insurance company headquartered in Birmingham, Alabama. The company, which was founded in 1936, provides coverage to more than 3 million people and is a member of the Blue Cross and Blue Shield Association....
- Blue Cross Blue Shield of Arizona
- Arkansas Blue Cross Blue Shield
- Blue Shield of CaliforniaBlue Shield of CaliforniaBlue Shield of California is a not-for-profit health plan founded in 1939 and based in San Francisco, California. The organization serves over 3.4 million health plan members and nearly 65,000 physicians across the state...
- Blue Cross Blue Shield of Delaware
- Blue Cross Blue Shield of Florida
- Hawaii Medical Service AssociationHawaii Medical Service AssociationHawaii Medical Service Association is an insurance company in Hawaii. It was founded in 1938 and is affiliated with Blue Cross Blue Shield Association.-Hawaii Medical Service Association :...
- Blue Cross of Idaho
- Blue Cross Blue Shield of Kansas
- Blue Cross Blue Shield of Louisiana
- Blue Cross Blue Shield of MassachusettsBlue Cross Blue Shield of MassachusettsBlue Cross Blue Shield of Massachusetts is a state licensed private health insurance company under the Blue Cross Blue Shield Association with headquarters in Boston.-Workings:...
- Blue Cross Blue Shield of MichiganBlue Cross Blue Shield of MichiganBlue Cross Blue Shield of Michigan is one of the largest independent licensee of Blue Cross Blue Shield Association. Currently it is headquartered in 600 E. Lafayette Blvd. Detroit in downtown Detroit...
- Blue Cross Blue Shield of Minnesota
- Blue Cross Blue Shield of Mississippi
- Blue Cross Blue Shield of Kansas City (Missouri)
- Blue Cross Blue Shield of Montana
- Blue Cross Blue Shield of Nebraska
- Horizon Blue Cross Blue Shield of New Jersey
- Excellus Blue Cross Blue ShieldExcellus Blue Cross Blue ShieldExcellus BlueCross BlueShield is a non-profit health insurance company headquartered in Rochester, New York. It is part of the Blue Cross Blue Shield Association...
(Central New York) - Blue Shield of Northeastern New York
- Blue Cross Blue Shield of Western New York
- Blue Cross Blue Shield of North Carolina
- Blue Cross Blue Shield of North Dakota
- Blue Cross of Northeastern Pennsylvania
- Capital Blue Cross (Central Pennsylvania)
- Independence Blue CrossIndependence Blue CrossIndependence Blue Cross is a health insurer based in Philadelphia, Pennsylvania in the United States. Together with its subsidiaries, IBC is one of the largest health insurers in the five-county southeastern Pennsylvania area of Bucks, Chester, Delaware, Montgomery, and Philadelphia counties. IBC...
(Philadelphia, Southeastern Pennsylvania) - Blue Cross Blue Shield of Rhode Island
- Blue Cross Blue Shield of South Carolina
- Blue Cross Blue Shield of Tennessee
- Blue Cross Blue Shield of Vermont
- Blue Cross Blue Shield of Wyoming
Idaho
BlueCross of Idaho and Regence BlueShield of Idaho are separate companies and compete head to head throughout the state.North Carolina
In the past Blue Cross Blue Shield has been sued and fined for denying due medical treatments to their customers and for underpaying doctors. BCBSNC has also come under fire for a failed attempt to convert to for-profit status in 2003, a year in which they posted a record profit of $196 million and most customers saw their rates rise by more than 10%.In May 2009, BCBS licensee, Blue Cross and Blue Shield of North Carolina, readied an ad campaign against the introduction of government-run health care
Publicly-funded health care
Publicly funded health care is a form of health care financing designed to meet the cost of all or most health care needs from a publicly managed fund. Usually this is under some form of democratic accountability, the right of access to which are set down in rules applying to the whole population...
, legislation to be introduced to Congress by President Barack Obama
Barack Obama
Barack Hussein Obama II is the 44th and current President of the United States. He is the first African American to hold the office. Obama previously served as a United States Senator from Illinois, from January 2005 until he resigned following his victory in the 2008 presidential election.Born in...
, although the BCBSNC CEO said that the company was in favor of reforming the current system.